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For dentists in Wales, we have heard that the CDO, Dr Colette Bridgman, has confirmed that mixed-contract practice owners are eligible for government-backed financial support for the private element of the business for April, May and June.

Should you hear anymore updates on this subject, or have any questions on this, please do contact me directly, I would love to hear from you.

Now for something different to read about over the holiday break.

Are you a Dentist? Are you a woman? Do you sometimes feel under STRESS?

Well you are not alone.

New research has shown that as many as one in three women do not feel comfortable discussing their mental health.

According to the findings by mental health treatment specialist Smart TMS, women suffer higher levels of social anxiety, poor self-image, and loss of confidence than men. Over a quarter (27%) of women regularly cancel plans to avoid social interaction as a result of severe anxiety, compared with 21% of men, while as many as four in 10 (39%) of women say they feel significantly less confident than they once were, versus 28% of men.

Despite this, nearly a third (29%) of women feel unable to open up to their family or friends about their mental health challenges for fear of judgement, while 24% said they feel unable to discuss their mental health with their partners. The results of the research showed that work had a big impact on the mental wellbeing of women, with 31% admitting to suffering from unmanageable levels of stress and anxiety brought about by work and 29% feeling unable to discuss their mental wellbeing with their colleagues. A quarter of women (25%) surveyed said they’re too busy to prioritise their mental wellbeing, despite suffering from depression or anxiety.

With many women reporting ill side-effects or little positive effects of medication, Smart TMS’ research has suggested that other methods of mental health treatment should be explored.

Gerard Barnes, CEO, Smart TMS, has called upon industry and government to prioritise mental wellbeing, creating more awareness and open conversations around the topic of mental health.

Barnes said: “It has been made very clear that a huge proportion of women across the UK are suffering with a variety of mental health challenges. Events such as International Women’s Day are fantastic initiatives to help raise awareness, but it’s evident that we cannot limit our focus on the issue to one single day.

“More needs to be done to help everybody across the UK recognise symptoms of mental health conditions within their own behaviours and respond accordingly, especially for women. It is also vital that people in positions of power, both in the public and private sectors, focus their attention on making more mental health provisions available. Britain’s employers must provide more mental health support and wellness initiatives, and health services must be equipped with the resources needed to introduce more support and explore new treatment methods.”

Source: Smart TMS

LET’S Talk About Money for a Change

WHA T DO ES T HE G L OB AL L OC K D OWN M E A N F O R D IV I DE N D S? Latest articles from Fidelity fund managers – providing insight into the impact of the pandemic in respect of market and investment issues, utilising the breadth of Fidelity’s investment capability around the world. NEW: What does the global lockdown mean for dividends? With large swathes of the world’s population on lockdown and economic activity on hold, we assess the likely damage to dividend payments over the coming months. We outline how Fidelity’s equity income portfolios are navigating this environment and why selectively forsaking dividend growth this year could still deliver a superior long-term outcome for investors.

NEW: Understanding market volatility

Financial history shows that from time to time markets experience bouts of heightened volatility. These setbacks could be the result of any number of factors: economic uncertainty, monetary or fiscal policy changes, financial contagion or geopolitical tension, for example. With this in mind, Fidelity has produced interactive tools to take a look at the past and highlight what lessons we can learn for the future

The three phases of investing through a global pandemic

Key points

 The coronavirus pandemic can be thought of as evolving in three phases: escalation, consolidation, and recovery, which map onto the stock market in various ways.  It is important is to understand the resilience of companies to the current challenge, and their long-term franchise value, in order to take advantage of opportunities.  New names have been added to the portfolio, including staples and healthcare companies, putting cash to work while maintaining a reasonably balanced profile. Recent weeks have been one of the most eventful periods in markets that I can remember since 1987. Never mind what was happening in the real world, the normal market dynamics were breaking down. As it happens for brief periods from time to time, there was a real sense of panic. Nothing was behaving as it should. This is what happens in highly volatile periods of the market - few movements can be justified by fundamentals, and nearly everything can be explained by positioning and forced actions by participants who cannot or choose not to hold their ground.

The Fidelity investment team (nearly everyone working from home) were busy with company calls, talking to senior management to try to understand what they had been seeing in the effects of the coronavirus first in China and now in Europe and the US, how they gauged the challenges of both supply and demand factors and how strong their cash positions really were.

Mitigation and suppression strategies

The recent Imperial College report talks of two basic approaches to deal with a pandemic - mitigation and suppression. In mitigation, the progress of the epidemic is slowed down so that health systems are better able to cope with the outbreak. In this approach, eventual herd immunity is achieved, but at a huge cost. Suppression is the more drastic approach that aims to reverse the epidemic and aims as far as possible to eliminate the transfer of the virus once the outbreak has been identified.

We know that China fairly swiftly moved to this approach in Wuhan. This was very painful for the citizens of Hubei province for a period but appears to have been highly effective so far. European countries are now rapidly moving to the suppression approach. Assuming there is a reasonable degree of success in suppressing the virus, the question is what happens next and what measures will be taken to ensure that the epidemic does not break out again. At this point I am thinking of this as evolving in three phases: escalation, consolidation, and recovery.

Phase 1: Escalation

The first escalation phase is upon us where we see huge increases in reported new cases. While the curve may still look exponential the “second derivative” appears to be improving. Given the draconian containment measures now in place in Italy, this should mean that here the active infection rate should peak soon. The same should follow in the rest of Europe, and then the US sometime later.

How does this map on to the stock market?

This escalation phase has caused huge volatility which produces an extraordinary amount of noise and wild share price movements.

In my opinion there are many shares that have gone down more than their fundamental outlook would warrant. This is most clearly visible in defensive areas such as utilities and healthcare companies, which are likely to see only short-term profit deterioration even if the economy fails to bounce back quickly. Some other companies which are more economically sensitive arguably have fallen so sharply that they have rebound potential even before full economic recovery is evident.

What is important is to understand is how resilient companies are to the current challenges (in balance sheet and cash flow terms) and to judge their long-term franchise value. In any case, the massive dislocation we are seeing inevitably throws up opportunities.

Phase 2: Consolidation

The next phase which should be upon us shortly is what we may call (perhaps somewhat optimistically) the consolidation phase. This is when the virus appears contained but measures will still be in place to keep it that way. There will be medical advances to better treat people and perhaps make them more resistant to infection, for example through the antibody cocktail now being tested by Regeneron Pharmaceuticals.

In this phase we will get a much clearer idea of who will bear the costs, how much bad debt will be recognised and how much long-term damage has been done to the economy. Clearly there is a concern that job layoffs will cause a negative spiral which will potentially lead to full scale depression. In this regard, the measures announced by the UK government are being echoed elsewhere and this is encouraging. It is clearly of massive importance that jobs are retained through the escalation phase so that consolidation afterwards does not become a slump.

Phase 3: Recovery

The final phase of the coronavirus saga should then be recovery, likely marked by decisive medical prevention of further spread and a full return to normal social interaction. As far as the market is concerned, this is unlikely to go in a straight line since the markets will already have anticipated economic improvement. As this comes, there are likely to be revelations of unexpected bad debts that have been hidden in the crisis period. There will also be an element of “payback” for government support given.

Will governments have printed too much money in order to support economies? Will there be inflationary consequences? And will taxes have to rise substantially? I would guess that at least we should expect rises in tax rates, not least in the US (especially if there is a change in the administration) where the fiscal position has already deteriorated significantly as a result of the last round of tax cuts.

Portfolio positioning

We started the year with relatively low cash levels and relatively high economic sensitivity. When the outbreak started in China, we started to change this position, raised cash, and brought down sensitivity to market moves by reducing high beta positions. As the market fall accelerated, the risk in these positions was further accentuated.

In the past several weeks, we have further reduced exposure to financials (mostly banks but also some insurance positions), transport-related names and also energy companies most exposed to the sharp fall in the oil price, which we do not expect to recover meaningfully in the near-term.

In contrast, we have added to companies that are clearly going to be most resilient and those that should see a near full recovery after the current downturn. With the huge volatility we’ve seen, we have added new names in areas like staples and healthcare, as well as increasing our ecommerce exposure.

Looking forward

There is a still a huge amount of noise and returns can be expected to swing around in the short-term. Nevertheless, we are confident that we have significantly reduced exposure to weaker companies and increased exposure to long-term winners at reasonable prices. Over the coming weeks, we will be channelling most of our efforts into staying close to our investee companies to understand their strategies and current challenges whilst at times providing our feedback to management. This is key to our approach to active management. We can assure investors that in this regard whilst we may be working from home, we remain highly active.

Source: Fidelity

If you are concerned about your savings, your ISAs, and your Pension ring me for a conversation. Look at the world’s largest economy the United States, history can’t repeat itself can it?


We sometimes find ourselves handling an enquiry from a client who wishes to buy a business. Key questions around the subject are likely to include how the transaction is to be structured and funded and, often, the client does not have enough business / personal wealth to conclude the transaction in their own right. Clients might turn to us for guidance on how else the transaction might be structured.

The first port of call may be financing the deal with borrowed funds. Various sources of this finance might be available, including borrowing from the client’s own business / personal bankers.

Of course, if the borrower is a limited company, a Small Self-Administered Scheme (SSAS) could be the source of the funds provided the company in question is a ‘sponsoring employer’ of the SSAS. The loan must meet strict criteria laid down by HMRC. One of the most challenging of these criteria is that the loan must be secured by a First Legal Charge over a suitable asset or assets of at least equivalent value to cover the amount of capital and interest due over the term of the loan. It is this requirement alone that often rules-out a SSAS as a source of loan finance to a connected business. However, it should also be noted that a SSAS can lend to companies that are not connected with the SSAS members, without the same HMRC constraints that apply to loans to sponsoring employers.

Self-invested personal pensions (SIPPs) cannot lend funds to connected parties – either directly or indirectly. As a result, SIPPs cannot be viewed as a source of loan finance to connected parties.

Equity participation (unquoted shares)

Where the business being acquired is a limited company, the underlying transaction might be purchase of some / all the share capital in that business from the current shareholders. Given that SIPP and SSAS are permitted to acquire unquoted shares, it would be natural to view these as a potential source of funds to assist with the business purchase.

There are, however, significant due diligence considerations to be borne in mind with SIPP / SSAS unquoted share ownership and the due diligence work should be structured to ensure that ownership of those shares does not cause tax penalties. For example, extreme care should be taken to ensure that the SIPP / SSAS is not in a position to exercise any degree of direct or indirect control over the limited company and that no SIPP or SSAS member or anyone connected with a member, is a controlling director of the company. A surprisingly small SIPP / SSAS shareholding could create a casting vote situation with four or fewer other shareholders.

A SSAS is also limited to using no more than 4.99% of its net market value to acquire shares in a company that is a sponsoring employer of the SSAS. This restriction does not apply to SIPPs.

Commercial property

It may surprise readers to learn that commercial property purchase by SIPP / SSAS is often the easiest way for self-invested pensions to participate in a business acquisition. Bricks and mortar can be viewed as a complex area, and undoubtedly it can be in some cases, but in comparison to the other funding options outlined above, it can actually be the most straightforward and achievable route to go down. It also helps that the rules for property purchase are identical for SIPP and suitably structured SSAS, so either vehicle might be suitable depending on the client’s circumstances.

In order for this route to be feasible, the business being acquired must, of course, own commercial property and it must be available for purchase as part of the overall deal to buy the business – as is often the case.

In terms of the nuts and bolts of the transaction, it is likely to be necessary to isolate the value of the bricks and mortar element of the business from all other elements such as plant and machinery, stock, debtors’ book, goodwill and so on. Typically, this will involve instructing a Royal Institution of Chartered Surveyors (RICS) Registered Valuer to value the bricks and mortar specifically. Any “tangible moveable property” (such as desks, chairs, computer equipment, etc.) should be excluded from the Valuation and from the SIPP / SSAS purchase because these items would be “taxable” property if owned by the SIPP / SSAS. If the bricks and mortar include a residential element which does not comply with HMRC’s narrow rules around these being held in SIPP / SSAS, then it too, should be excluded from the Valuation and from the purchase by SIPP / SSAS. Ultimately, the client can use business and / or personal wealth to acquire the business excluding the bricks and mortar, with the SIPP / SSAS separately acquiring the commercial property.

With careful attention to the detail, SIPP / SSAS can assist a client to acquire a business in a number of ways and the pension arrangement might be key to the overall funding structure.

Case study

Dentist practice for sale – purchase price £750,000 (including commercial property, fixtures and fittings, goodwill, etc.).

Client has personal / business funds available of £500,000

RICS Registered Valuer is instructed to value the commercial property owned by the practice (no residential element). Valued at £250,000.

Client has £180,000 in an existing personal pension which is transferred in cash form into bespoke SIPP.

(Client does not wish to make any Employer / Member contributions because business / personal cash is needed for the business purchase). SIPP borrows £90,000 (maximum 50% of its net asset value) from a commercial lender.

SIPP acquires commercial property for £250,000, leaving £20,000 to cover all associated costs such as Stamp Duty Land Tax (SDLT), legal and valuation fees and so on. Property is not opted to tax (so, no VAT payable on the purchase price).

Client uses personal / business funds of £500,000 to acquire the other elements of the business and the business acquisition is completed.

Commercial property is leased to client’s business with a commercial level of rent (as confirmed by the Registered Valuer) being paid into the SIPP. Source:Dentons & Professional Paraplanner

Essential Links for assistance via

As new information is coming to light the below links are updated swiftly should you need a quick reference guide.

Self-Employment & Universal Credit

Employment & Support Allowance

Covid-19 Small Business Government Grant 3000-coronavirus-grant-2549866/

Coronavirus Business Interruption Loan 2549863/

Citizen’s Advice costs/

Emergency Funding cbils/

No 10 Daily Briefing – main points

Dominic Raab Foreign Secretary said:

PM continues to progress and is good spirits. 16,784 in Hospital. 3 weeks of social distancing. Thanks to the NHS. We will never forget those doctors and nurses who lost their fight.

Thank you to the volunteers. Massive thank you to those who stayed home. Must keep going. No let up. We are guided by the science and measures stay in place until we see we have passed the peak.

We must stick to the plan, to slow the spread of the virus. Follow the Government guidance. This is a team effort, please stay home this weekend. 881 died today in England. Cases doubled in 3 days initially, now its approx. 6 days. Consequently, there is still room and spare capacity in hospitals.

As we approach the Bank Holiday weekend not to lose gains we have made or take our eye off the ball.

Think long and hard to those on the front line if people don’t comply with the rules. Bank of England has extended its overdraft to the Government. Should you have any concerns or questions, we are here for our clients and will happily arrange a telephone or video call appointment to provide guidance, please either call our practice mobile 07543 368 478 or email to arrange your appointment.

We are here to help you through these challenging times, so please get in touch.

Finally, some free advice – Stay safe, stay home this weekend

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